Greater New Orleans

Avondale shipyard still on track for closure, CEO says

Huntington Ingalls Industries Inc. is still on track for a 2013 closing of its Avondale shipyard, long a major southeastern Louisiana employer, the company's chief executive said Wednesday. But during a Wednesday conference call with investment analysts, Huntington Ingalls CEO Mike Petters said the company is open to find a joint venture partner in a new use for the military shipyard, although the partner would have to be financially sound and produce a product for which there is a demand.

Susan Poag, The Times-Picayune archiveWorkers from Avondale shipyard held a rally September 24, 2010, outside of the shipyard as part of the ongoing SOS "Save Our Shipyard" campaign in response to the proposed closure of the Avondale facility by 2013. The company's CEO said Wednesday that the shipyard's closure is still on track.

Huntington Ingalls, based in Newport News, Va., is the product of a 2011 spinoff of defense giant Northrop Grumman Corp.'s military shipbuilding division -- a step Los Angeles-based Northrop Grumman took in the face of tight military budgets and the threat of more cutbacks in defense spending.

When the deal was announced in 2010, Northrop Grumman said part of the long-term plan for the new independent company would be to close Avondale, which has seen its payroll cut from nearly 5,000 to about 3,300 employees over the past few years. Workers are being laid off as their jobs are completed on two Navy ships currently under construction there.

Both are Navy amphibious assault ships designed to carry Marines into combat. The LPD 23, which will eventually become the USS Anchorage, is scheduled to be completed this year. The LPD 25, which will eventually become the USS Somerset, is scheduled to be completed by the end of 2013 -- bringing the shipyard to a close unless a new use is found for it.

Last fall, the state offered Huntington Ingalls a $214 million incentive package to keep the yard open. State officials say the yard could be used for oil and gas rigs, offshore wind, generators, commercial nuclear energy and commercial shipbuilding. That offer came shortly after the Navy cleared the yard for new commercial uses.

Petters did not indicate whether Huntington Ingalls had found any potential partners. But he said a partner would have to be financially viable and be able to produce a product for "a credible and sustained market." He said "the clock was ticking" at Avondale.

"We're committed to our Avondale employees to pursue this and we're turning over every rock to do this," Petters said. But we're still on track to close" the shipyard in 2013.

Huntington Ingalls also operates Ingalls Shipbuilding at Pascagoula, Miss. and Newport News Shipbuilding in its home city.

The state Department of Economic Development did not immediately respond by telephone or email for comment.